{"id":34386,"date":"2025-05-21T11:42:06","date_gmt":"2025-05-21T11:42:06","guid":{"rendered":"https:\/\/onequity.com\/dollar-keeps-falling-the-pound-sterling-goes-up-because-of-higher-inflation\/"},"modified":"2025-05-21T11:42:06","modified_gmt":"2025-05-21T11:42:06","slug":"dollar-keeps-falling-the-pound-sterling-goes-up-because-of-higher-inflation","status":"publish","type":"post","link":"https:\/\/onequity.com\/pt\/dollar-keeps-falling-the-pound-sterling-goes-up-because-of-higher-inflation\/","title":{"rendered":"Dollar Keeps Falling, The Pound Sterling Rises on Higher Inflation"},"content":{"rendered":"\n

The U.S. dollar continued to decline on Wednesday, weighed down by uncertainty surrounding President Donald Trump\u2019s proposed tax and spending bill. Meanwhile, the British pound gained ground following stronger-than-expected inflation data.<\/p>\n\n\n\n

As of 04:30 ET (08:30 GMT), the U.S. Dollar Index<\/a>\u2014which measures the greenback against a basket of six major currencies<\/a>\u2014dropped 0.4% to 99.595, extending its two-day slide to 1.3%.<\/p>\n\n\n\n

U.S. Tax Bill Faces Resistance; G7 in Focus<\/strong><\/h2>\n\n\n\n

President Trump\u2019s tax reform plan encountered pushback from several lawmakers, with a key vote expected in the House of Representatives on Wednesday. According to nonpartisan estimates, the bill could add between $3 trillion and $5 trillion to the national debt. This comes just a week after Moody\u2019s downgraded the U.S. credit outlook over concerns about rising fiscal deficits.<\/p>\n\n\n\n

A combination of widening debt, trade tensions, and diminishing investor confidence has driven the dollar down nearly 8% year-to-date.<\/p>\n\n\n\n

Traders are also cautious ahead of the G7 finance ministers\u2019 meeting in Canada, which concludes Thursday. Analysts at ING noted a “low-probability, high-impact” risk that the G7 may revisit its commitment to freely floating exchange rates, potentially allowing for a weaker dollar. \u201cIf speculation is correct and the U.S. is indeed pushing for stronger foreign currencies, it could spur gains in those currencies while deepening pressure on the dollar,\u201d ING added.<\/p>\n\n\n\n

Sterling Surges on Surprising Inflation Jump<\/strong><\/h2>\n\n\n\n

In Europe, GBP\/USD climbed 0.2% to 1.3419 after U.K. inflation data exceeded expectations. April’s consumer price index rose to 3.5%, up from 2.6% in March, marking the highest annual rate since January 2024 and the steepest monthly increase since 2022.<\/p>\n\n\n\n

However, ING analysts pointed out that much of the spike stemmed from a rise in road tax, along with seasonal factors such as higher airfare and holiday prices due to the timing of Easter. While markets largely expect the Bank of England to hold rates in June, the data does not rule out a possible rate cut in August.<\/p>\n\n\n\n

Elsewhere, EUR\/USD advanced 0.4% to 1.1324, as traders turned to the euro amid growing dollar weakness. The common currency held steady despite a phone call between Presidents Trump and Putin showing no breakthrough in the Russia-Ukraine conflict.<\/p>\n\n\n\n

\u201cThe next resistance level is 1.150, though achieving that likely requires softer U.S. data or more positive developments on the geopolitical front,\u201d ING noted. \u201cFor now, 1.130 looks like a more realistic short-term target.\u201d<\/p>\n\n\n\n

Yen Rises on Trade Data; Yuan, Aussie Also Gain<\/strong><\/h2>\n\n\n\n

In Asia, USD\/JPY dropped 0.3% to 144.08 after Japan\u2019s trade balance unexpectedly narrowed in April. A stronger yen and elevated U.S. tariffs curbed exports, while imports held up better than projected.<\/p>\n\n\n\n

The Chinese yuan also strengthened, with USD\/CNY slipping 0.2% to 7.2083, supported by broader dollar weakness. Tensions between the U.S. and China resurfaced after Beijing criticized new restrictions on Chinese semiconductor companies and condemned Washington\u2019s push to ban Huawei chips globally. Chinese officials warned that such actions could threaten the fragile 90-day trade truce.<\/p>\n\n\n\n

Meanwhile, AUD\/USD recovered 0.4% to 0.6442, rebounding from losses following the Reserve Bank of Australia\u2019s25 basis point rate cut on Tuesday.<\/p>\n","protected":false},"excerpt":{"rendered":"

The U.S. dollar continued to decline on Wednesday, weighed down by uncertainty surrounding President Donald Trump\u2019s proposed tax and spending bill. Meanwhile, the British pound gained ground following stronger-than-expected inflation data. As of 04:30 ET (08:30 GMT), the U.S. Dollar Index\u2014which measures the greenback against a basket of six major currencies\u2014dropped 0.4% to 99.595, extending […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[205,210],"tags":[220,221,222,223,229],"class_list":["post-34386","post","type-post","status-publish","format-standard","hentry","category-markets-pt","category-currencies-pt","tag-currencies-pt","tag-dollar-pt","tag-euro-pt","tag-yen-pt","tag-yuan-pt"],"acf":[],"yoast_head":"\nDollar Keeps Falling, The Pound Sterling Rises on Higher Inflation - OnEquity<\/title>\n<meta name=\"description\" content=\"The U.S. dollar weakens on tax bill concerns, while the pound rises on strong inflation and G7 speculation boosts other currencies.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/onequity.com\/pt\/dollar-keeps-falling-the-pound-sterling-goes-up-because-of-higher-inflation\/\" \/>\n<meta property=\"og:locale\" content=\"pt_PT\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Dollar Keeps Falling, The Pound Sterling Rises on Higher Inflation - 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